There has been considerable interest in the public sector changes in New Zealand, as they were seen as characterising an international reform trend. This thesis employs a critical change model to evaluate the development and impact of accounting-led reform in the New Zealand public sector. By combining an analysis of the reform initiatives in health and education, and longitudinal-case studies of schools and GP practices, this study examines the question of how teachers and the doctors managed new forms of financial control and visibility. The critical theoretical model used here was derived from the Laughlin and Broadbent research on the accounting-led reform within the UK. The generalisability of their UK research was evaluated by applying their theory and methodology in the New Zealand context. Although New Zealand now constitutes an important site for research, much of the existing literature has focused on the policy proposals for the reform of health and education. There have been few evaluations of the changes in accounting practices and forms of accountability that were implemented. Based on the Laughlin and Broadbent theoretical model it was expected that the New Zealand reforms would be seen as a threat to the autonomy of GPs and teachers and would consequently, be absorbed, protecting the core values and real work of the organisation. The case studies revealed that there were strong similarities between the UK and the New Zealand experiences. However, the findings suggested that the theoretical framework needed modification in a number of ways. Laughlin and Broadbent's conclusion that small groups absorb change was found to be too simple and was extended in the study to recognise that change can also be absorbed at the institutional level. The concept of institutional absorbing structures is and important theoretical contribution of this study and also provides a link between the organisational focus of the Laughlin and Broadbent studies and the supra-organisational level. Another important finding was that while the financial and administrative reforms were absorbed, changes in the core work structures and practices could not be absorbed, indicating that the nature of the change process is under-theorised in the current framework and further work is required.